Reform UK has suspended a party activist who reportedly said that you cannot be Muslim and British in footage recorded by an undercover reporter from ITV News.
It is also investigating two of its councillors who appear to have advocated for the mass shooting of grooming gang members in the footage.
The party's response follows the latest allegations from undercover filming by ITV News, external, which has led to Reform facing questions over its vetting procedures for candidates.
A party spokesperson told the BBC it was pursuing legal action against ITV and the documentary's production company which had used undercover reporting to obtain its material.
In the ITV documentary Undercover: A Year in Reform - set to be broadcast on Sunday - party activist Jason Powell reportedly says: "You cannot be Muslim and British, it's like oil and water."
In the footage, Powell, who has applied to be a Reform parliamentary candidate, also says he believes migrants who arrive illegally should be kept in "concentration camps" if they cannot be returned to their country of origin.
Reform said Powell has been suspended from party membership while an internal investigation takes place.
Reform is also investigating two councillors who represent the party in the London borough of Hounslow.
In the footage, Councillor David Kerr advocates machine gunning thousands of grooming gang members.
His colleague Councillor Adam Parkins suggests if he became prime minister he would conduct Sunday morning executions in the Downing Street rose garden.
The BBC has contacted both councillors for comment.
In a statement to ITV, Reform said there is "no room for racism" in the party, and added that it has opened investigations where activists or members had "clearly behaved inappropriately".
Reform UK has said it has prioritised and improved its vetting procedures.
On Wednesday night, ITV News broadcast undercover filming which showed some of Reform's councillors and candidates using racist, violent and sexist language.
Responding to the broadcast, Reform UK MP Robert Jenrick said all political parties had "bad apples".
Speaking to the BBC's Today programme, he said he "didn't like what I heard in the documentary" but argued that the party had acted quickly, removing or suspending those in the undercover film.